BAIE-COMEAU, Q.C.—A $486 million project to upgrade a winding and ill-developed highway in northeast Quebec has received $183 million from the federal government.

The Highway 389 Improvement Program is part of Plan Nord, the province’s $2 billion project to spur economic development in northern Quebec.

Highway 389 runs 570 kilometres from the city of Baie-Comeau to the Newfoundland Labrador border town of Fremont, Q.C.

Construction, to be completed in five phases, includes road alignment, repairs, reconstruction, curve correction and the development of new routes.

Quebec hopes the program will encourage investment in mining development projects in the iron-rich Labrador Trough, a more than 1,000 kilometre stretch of land that crosses Quebec and Newfoundland and Labrador.

The two provinces agreed in April to improve road infrastructure in order to access the area’s mining potential. Newfoundland and Labrador committed to continue already onoging road improvements along Route 510, part of the Trans-Labrador highway.

Quebec has put up the remaining $285 million needed for the Highway 389 program, with $190 million coming from the Société du Plan Nord and $95 million from the provincial transportation department.

The Société du Plan Nord is the agency responsible for Plan Nord’s implementation.